Shadow Chancellor Ed Balls has praised the “strength and dynamism” of Israeli innovation and urged British companies to increase their business links with the country.

Mr Balls said Britain needed to take its financial ties with Israel “to the next level” by putting the country’s high-tech developments “on people’s radars”.

The former Labour Education secretary spent two days in Israel and Ramallah this week, meeting Israeli economic leaders , including Finance Minister Yair Lapid, outgoing Bank of Israel governor Stanley Fischer, and Eugene Kandel, head of the National Economic Council.

Speaking to the JC in his office at the House of Commons, Mr Balls said the British government should do more to follow the Israeli economic blueprint.

“The Israeli success is based on a strong partnership between government, research and development, support for innovation and high tech, and we have a lot to learn from that.

“We need more concrete leadership from the current government. It's one thing to go to a community dinner and say the right things, it's another to actually do the right thing and make the visits and foster the links. Not enough of that is happening at the moment.

“Labour in government would step up the depth of that relationship and show there is more we can do.”

Mr Balls said there was a danger that the “deep and important trading relationship” between Britain and Israel could be overshadowed by calls for boycotts. He urged universities in both countries to strengthen their partnerships.

“We have a huge amount to learn from Israel's success. You've got to say to British companies: ‘Have you seen what's happening in Israel?’

"We are not a party which walks away from our friends. We have no truck with stand - offs and boycotts.”

But he admitted: “This has been a difficult time for Israeli relations with the wider world. I think Prime Minister Netanyahu is sometimes his own worst enemy in terms of some of the signals he sends.”

Mr Balls was accompanied on the visit by Jennifer Gerber, director of Labour Friends of Israel. He held meetings at the UK-Israel Tech Hub at the British embassy in Tel Aviv and toured the Yad Vashem Holocaust museum in Jerusalem, where he laid a wreath.

The itinerary included a tour of the Knesset and discussions with senior MKs from the Israeli Labour party, including Isaac Herzog.

On Tuesday Mr Balls travelled to the new Palestinian city of Rawabi and saw the economic developments in the West Bank. He also discussed with senior Palestinian politicians the role their economy can play in attempts to bring peace to the region.

Mr Balls said a dose of “hard-headed optimism” could help broker peace.

"This was the first time I've been back in Ramallah for six years. The development was striking. The fact they have got to this stage is already a massive achievement. They are facing big issues around the complexity of movement, water and power from Israel.

“It is in Israel's interests to give more on the economy. There could be massive opportunities. A strong Palestinian economy is in everyone's best interests.”

On domestic issues, Mr Balls attacked the Liberal Democrats over the party’s handling of comments made by its MP, David Ward.

Speaking in Parliament last week, his Lib Dem colleague Sir Bob Russell appeared to equate the Holocaust with events in the Middle East.

Lib Dem central office was this week unable to clarify when and how disciplinary action against Mr Ward would be taken.

Mr Balls said: “There's always going to be some foolish and ignorant voices. I would like to take a couple of these people to Yad Vashem and spend a couple of hours reflecting on what happened and for them to realise the deep ignorance of what they said.

“Antisemitic remarks are unacceptable, whoever they come from. I'm disappointed with the response to the Ward comments. In the Labour and Conservative parties they wouldn't be tolerated.”

Mr Balls acknowledged that the Jewish community was “worried” by the comments, and said “people in positions of authority” had “ducked” the opportunity to take action.

But he also believed there was a “cross-party determination to root out antisemitism” and praised the work carried out by organisations such as the Holocaust Educational Trust. The charity’s work in his own Morley and Outwood constituency meant young people were now showing their commitment to “tolerance, diversity and an abhorrence of antisemitism”, he said.